Man Group’s $15.5bn fund of hedge funds’ business FRM’s latest Early View finds that markets over June proved the most extreme in terms of market behaviour in 2013, with both the Fed Policy and Chinese Economic Data shaking the markets. The firm writes: "Emerging Markets equities were difficult in places, with the move in US government bond yields, forcing investors to pre-price EM assets, fundamental worries and outflows all combining to result in large moves across both EM debt and equities."

Looking forward, FRM predicts that for the rest of the year, the Fed should act as a dampening mechanism, breaking trends as they start to develop. "Strong data could lead to a lessening of Fed involvement, whereas weak data could lead to a more active Fed" the firm writes.

Europe continues to be a concern with only US data affected by the Fed’s actions. FRM feels that a likely scenario is where US data remains strong, Fed talk of tapering QE is increased, but this translates into a weak European market. The firm also predicts a risk of dislocation in credit markets where a widening government bond yield and a widening spread may lead to material absolute losses in the credit complex.